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TMI Blog2015 (11) TMI 751X X X X Extracts X X X X X X X X Extracts X X X X ..... nst deletion of disallowance of Rs. 6,72,86,626/-, being the addition made by the Assessing Officer u/s 41(1) of the Income-tax Act, 1961 (hereinafter also called 'the Act') 4. Briefly stated, the facts of the case are that the assessee is a Public Sector Undertaking engaged in providing conceptual studies and management consultancy, healthcare facility, design, project management, procurement of health related products and logistic installation. During the course of assessment proceedings, it was observed by the Assessing Officer that there were certain old sundry creditors appearing in the assessee's balance sheet as at the end of the year. On being called upon to furnish the details of such creditors exceeding Rs. 1 lac and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mission or cessation is obtained that it becomes chargeable to tax u/s 41(1) of the Act. Adverting to the facts of the instant case, we find that the assessee was simply acting on behalf of its customers/clients and Government and getting consultancy fee from the client on account of services rendered. The sundry creditors as appearing in its books are actually on account of clients and not of the assessee. In such circumstances, the provisions of section 41(1) cannot be applied. It is further a matter of record that the assessee furnished details about the disputes going on between the two sides for which the payments were not made. The Executive Director of the assessee in his certificate has confirmed that all the outstanding sundry cred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... perusing the relevant material on record, it is noticed that the assessee gave Note No.4 in Notes to Accounts enclosed with the return of income stating as under:- "Hitherto the company was recognizing the consultancy fee for "work done but not billable in respect of incomplete stages on the basis of technical certificate from the concerned SBU's/Functional Department. It was noticed that consultancy fee booked on the basis of above was not due as per agreement with clients and contractually not recoverable until completion of a particular stage. Part of consultancy fee accounted for on this basis as accrued income in previous year could not be realized and had to be reversed. In view of above, it was considered prudent to recogni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rder that the Assessing Officer simply followed the view taken by him in earlier year. Both the sides are in agreement that the facts and circumstances of this ground are, mutatis mutandis, similar to those of ground No.2 for assessment year 2005-06. Following the view taken hereinabove, we uphold the impugned order deleting this disallowance. This ground fails. 10. The only other ground is against the allowing of depreciation @ 60% on computer peripherals like UPS, printers, etc. 11. After hearing both the sides and perusing the relevant material on record, we find that this issue is no more res integra in view of the judgment of the Hon'ble jurisdictional High Court in CIT vs. BSES Yamuna Powers Ltd., - 2010-TIOL-636-HC-DEL-15 decid ..... X X X X Extracts X X X X X X X X Extracts X X X X
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